By Rob Curran

Shares of semiconductor makers slid after a round of disappointing earnings and revenue-growth projections from specialist makers of chips for smart phones, industrial and automotive applications suggested a slowdown in certain parts of the highly cyclical business.

Cirrus Logic's revenue from the second quarter ended in September surpassed expectations, but was overshadowed by a disappointing forecast for the current period.

Cirrus, which makes chips used in iPhones, personal computers and other devices, logged earnings for the fiscal second quarter ended in September of $102.1 million, or $1.82 a share, up from $75.4 million, or $1.34 a share, a year earlier.

Second-quarter revenue rose 14% to $541.9 million, the Austin, Texas firm said, in a report late Monday.

For the third quarter ending in December, Cirrus targeted revenue in a range between $480 million and $540 million. The average analyst estimate called for $536 million, as per FactSet.

Shares of Cirrus fell 6.1% to $103.86.

Shares of NXP Semiconductors declined 6.4% to $222.83 after the maker of chips for automotive and other applications forecast reflects broader macro weakness in the automotive and internet of things markets in Europe and the Americas.

NXP, a Dutch firm, projected revenue for the fourth quarter of $3 billion to $3.20 billon, in a report late Monday. Analysts polled by FactSet had anticipated quarterly revenue of $3.36 billion.

Shares of Lattice Semiconductor fell 5% to $49.20. Lattice Semiconductor said revenue rose in the third quarter and that it's planning for a 14% cut to its workforce.

The chip maker reported a net profit of $7.2 million, or 5 cents a share, down from $22.6 million, or 16 cents a share, a year earlier. Analysts polled by FactSet had expected 13 cents. Revenue rose 2% to $127.1 million, in line with the average analyst target, according to FactSet.

Lattice's results for the third quarter results included a one-time charge of $6.5 million due to cost-cutting measures, which includes plans for a 14% reduction in both its workforce and operating expenses, the company said. It anticipates the cuts will help push annual earnings into the low-double-digits range next year, as reported earlier.

One brokerage said the weakness in Cirrus's fiscal third-quarter projection reflected one-off factors, and masked several promising trends, said analysts at brokerage Susquehanna Financial, in a note to clients. Last year's third quarter had an extra week and featured unusual dynamics in Android product launches.

"Looking ahead, we continue to be excited by (long-term) content growth opportunities at Apple, higher penetration into Android, and ultimately a sizable opportunity in laptops," said the Susquehanna analysts.

Investors are concerned that consumers are not upgrading to Apple's new iPhone 16 as initially anticipated.

Chip makers with specialized artificial-intelligence business lines such as Nvidia have seen revenues and share prices soar in 2024, while others have struggled.

The reports could also foreshadow economic weakness as semiconductor makers, particularly those who supply consumer-electronics and industrial companies, can be bellwethers for broader economic activity.

Write to Rob Curran at rob.curran@dowjones.com

(END) Dow Jones Newswires

November 05, 2024 10:05 ET (15:05 GMT)

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